What’s the cost of being stuck?
There are lots of ways businesses get stuck. They get stuck with people, stuck with systems, stuck with technology, stuck with products….there are hundreds of ways for business to get stuck. But what about the Cost?
This past week I learned of an example of a company that was stuck in old technology. The company was using an outdated phone system from the 80’s that was costing them $30,000 a month. Their new phone system, that is much more advanced, is now only costing them around $10,000/mo. Their cost of being stuck with that old phone system was a staggering $120,000 a year!
Why and where are you stuck?
We ask this a lot when we’re working with business owners. There is often a lot of overlap in Why business owners are stuck, the separation occurs more in the Where they are stuck. The reasons why business owners get stuck usually ties to a central theme…
They are too busy working “In the business” to work “On the business.”
(Thank you Michael Gerber…E-Myth)
And why businesses remain stuck is often because of comments like these….
- “Now just isn’t a good time.”
- “I know we need help, but I’m not sure we can afford it.”
- “We’ll work on that when things slow down a little.”
Statements like these are acknowledgments that the business is stuck, but every statement directs the owner and/or leadership team back to working in the business and the business remains…stuck! Without a commitment to a next step nothing every changes.
A next step….Where are you stuck?
Uncovering exactly where the business is stuck allows you to start putting a value on the cost of being stuck, even if they are estimates. We are not talking strictly about the cost as it relates to the financial numbers on the income statement. When you get specific about where you are stuck, that cost may be impacting your family, employees, customers, and suppliers too.
The company referenced above reduced the annual cost of their phone system by over $120,000. But how much did the upgrade in technology improve employee morale, productivity, the Customer experience? The total impact of upgrading the phone system could be substantially more than the reduced cost of their monthly phone bill.
What can you do?
Where is Your Business Stuck? Ask yourself (and/or your team) that question. There are few businesses that aren’t stuck somewhere. It is very likely you will have more than one place you feel like your business is stuck. If you honestly can’t think of a single area, congratulations you’re obviously killin’ it! But for everyone else, try to put a cost next to each of the areas you’re stuck in.
Don’t overthink it, because you’ll probably be guessing with your numbers or whatever you’re using for values. But the end result is you should have one or two areas rise to the top that significantly are costing your company more than other areas you may have listed as being stuck. Use the value you arrived as a driver to get your business unstuck in that area.
Very few business owners don’t feel stuck at some point. Putting a cost on being stuck is simply a logical way to encourage to you and/or your team to do something about it.
Commit to taking action. Even if you can only afford 1/2 hour a week to making a change, you have to start somewhere and your best bet is consistent, focused effort over time.
As always we would love to hear your thoughts on this topic.
Chris Steinlage Kansas City Business Coach